Dubai hotel stays are world’s second dearest

A week after Dubai grabbed the top spot for the best destination in the world for hotels, a new index has placed the emirate as the second most expensive city for average hotel room nights.

A new Bloomberg Index has rated Dubai second on a list of 106 cities ranked, which has Geneva, Switzerland in at first place, while Kuwait City comes in at number three.

However, in the five-star pricing category, Geneva retains the top spot at $614 per room night, while Los Angeles and Tokyo round up the second and third positions at $481 and $440 respectively.

Dubai’s average in the same category is $304.

Meanwhile, the average overall cost for a night in Geneva is $308, followed by Dubai at $273, Kuwait City at $253 and Zurich at $250.

Miami rounds up the top five spots, averaging at $245 per night.

Aside from Dubai and Kuwait City, two other Arab cities make it to the top 20 list, with Doha at number 13, averaging $226 per room night, followed by Riyadh at number 18 at $205.

Dubai attributes ‘high demand’ as a driver of a rise in room prices; but industry experts explain a check in room rates is imminent as 30,000 new rooms are expected to flood the market over the next two years, as confirmed by the Dubai Corporation for Tourism and Commerce Marketing CEO.

160,000 rooms by 2020

In an interview with Emirates 24|7, DCTCM CEO Issam Kazim said: “We estimate that by 2020 we will need a total of between 140,000 to 160,000 hotel rooms.

“Our existing stock is approximately 85,000 rooms and by the end-2016 we estimate between 20,000 and 30,000 new hotel rooms will be added. These are rooms which are currently in the pipeline; however, more hotels are continually being announced so supply will keep up with demand.”

Kazim said that while they haven’t broken down the room count in terms of categories, he added: “As well as maintaining our reputation as a top luxury destination, it’s important we further broaden our accommodation offering and as such in the past year a number of regulatory changes have been made to encourage and expedite development.”

In September 2013, Dubai Government announced an initiative to provide incentives to hotel owners to bring forward construction timelines of three- and four-star hotels, with eligible developments granted a concession on the standard 10 per cent municipality fee that is levied on the room rate for each night of occupancy, he further explained.

Kazim added: “The financial incentive to develop more mid-range hotels has been received very well by the hotel investment and development industry and will swell the number of mid-range hotels which are constructed and opened in the next three to four years.”

Last week, in an interview with Bloomberg, Dubai developer Union Properties revealed plans to build about 1,000 affordable hotel rooms in the next five years to address a shortage in the mid and lower-end of the market.

UP managing director Ahmad Al Marri was quoted as saying: “Most of the demand is at the three- and four-star level, because the majority of existing affordable hotels tend to be located in the older part of Dubai.

“We can’t invite people to visit the city just to have them come and find it very expensive.”

Last month, Dubai was ranked as the top destination for shopping and hotels with global travellers in a survey conducted by TripAdvisor.

The travel site announced the results of its second annual ‘Cities Survey’, revealing how travellers view key tourist cities around the world.

The accolade comes close on the heels of a by Daily Telegraph survey that saw people vote for the Burj Al Arab as the world’s most luxurious hotel, along with the city named as one of the top 25 places to go worldwide in the Traveller Choice Awards 2014 by TripAdvisor.

Kazim further said: “It’s an honour to receive accolades such as this… This is reflective of the Government’s historic and long-term strategy of focusing on tourism as a driver of economic growth and ensuring that retail is a critical part of the destination mix alongside the continual development of a portfolio of outstanding hotels.

“Awards such as this show the global recognition of Dubai as a must-visit destination and we continue to work towards the ultimate aspiration of being the world’s most recommended leisure and business destination.”

He continued: “But as always, we mustn’t get complacent. Looking ahead, we are continuing to work towards our goal of becoming the world’s most visited city and, of course, preparing to welcome our target of 20 million visitors by 2020 with three main areas of focus: families, events and business.”

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